Life Insurance Articles

If you haven't already, it's time to designate a successor owner to your AAFMAA insurance policy, if it covers your spouse or child. By naming a successor owner, AAFMAA is able to automatically transfer ownership of a policy over to that person upon your death. But if you do not take this simple step now, your policy will become part of the property of your estate, which can lead to time-consuming and costly administrative steps for your spouse or other loved ones.

As one of our policy owners, you can look forward to receiving your 2017 Annual Policy Statements soon. An important part of a Life Lived Well is your preparation for the future. Empower yourself and your loved ones by taking a few minutes to review your 2017 AAFMAA statements, specifically for accuracy in the following areas:

It just became a whole lot easier to update your Servicemembers’ Group Life Insurance (SGLI). SGLI is a program that provides life insurance coverage to eligible servicemembers. The Department of Defense has implemented the new SGLI Online Enrollment System (SOES) to replace the previous paper-based enrollment system.

Money-saving life insurance strategies

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Written By

AAFMAA Team

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Life Insurance

2015-02-23

Defining Your Coverage

SGLI: Servicemembers Group Life Insurance, which provides $400,000 of life insurance for $28/month. You must have SGLI to get TSGLI or FSGLI.
TSGLI: Traumatic SGLI, which costs $1/month to provide up to $100,000, if your service member suffers a traumatic injury, including loss of limb, sight, or other trauma.
FSGLI: Family SGLI, which provides up to $100,000 of coverage on spouses for $5/month for spouses under 35 (and slightly more for older spouses). It also includes $10,000 coverage on each child.

Is that Enough?

It depends on your family’s needs, but $400,000 would only last for about 8 years. Even if it was invested prudently, and combined with DIC (Dependency and Indemnity Compensation), it may not be enough.

Can I do better?

AAFMAA provides Level Term insurance for the American Armed Forces, with $400,000 costing only $18.15/month. This is not just less expensive, but because it will last after your service member leaves the military—until age 50 (age 40 if you are a smoker). Most importantly, it comes with AAFMAA’s exclusive Survivor Assistance Services. At the time of a member’s death, AAFMAA will coordinate with Social Security, the VA, and others to ensure that your family gets all of the military, veterans, social security, and other benefits to which they are entitled.

Should I cancel SGLI?

You should not necessarily cancel your SGLI entirely. Instead, do the following:

Apply for AAFMAA coverage at $400,000 for $18.15 per month at www.aafmaa.com.

The total cost is $31.15/month—less than you are paying now—and provides a total of $500,000 of life insurance, continues after the military, and includes survivor assistance services. The AAFMAA Level Term policy includes $10,000 of child’s life insurance, so children would have a total $20,000 of coverage.

Payments could still come from pay reflected on your LES, just as they do today. Apply online (connect.aafmaa.com/apply) or call (877) 398-2263) to begin AAFMAA Level Term I insurance for $400,000. Then fill out two simple forms at finance: SGLV Form 8286 will reduce your SGLI to $100,000 and DD Form 2558 to start your AAFMAA allotment.

Also members of the American Armed Forces who are E-5 through O-3 and start a $250,000 or greater life insurance policy by allotment can get a $4,000 Career Assistance Program (CAP) loan at just 1.5%.